OneRail Raises $33 Million, Looks to Expand to SMB

OneRail Lisa and Bill Catania feature

OneRail co-founders Lisa and Bill Catania (contributed photo)

OneRail, an Orlando-based startup with software that optimizes last-mile deliveries, has raised $33 million in a Series B round to further develop its platform and bring in new talent to fuel its growth, with plans to launch an extension for SMBs on Shopify in 2023.

The latest funding was co-led by Piva Capital and Arsenal Growth Equity, bringing the total raised to $54.5 million since OneRail’s seed round two years ago. Major customers include Advance Auto Parts, Lowe’s, Caterpillar, PepsiCo and Tractor Supply.

OneRail said it is processing 1 million deliveries per month from 10,000 destination points in 330 cities nationwide. In addition to retail and manufacturing, it also has customers in construction materials, 3PL and healthcare, and headcount is at 130, up from 75 at the end of last year.

To illustrate the company’s rapid growth trajectory, co-founder Bill Catania said it took OneRail two and a half years to get to 1 million deliveries managed as of this past March, then just another seven months to hit 7 million in November. He said revenue from both the company’s SaaS platform and its courier network has increased more than 300% in 2022.

“The next chapter is going to be all about data science,” said Catania, a serial entrepreneur who co-founded OneRail in 2018 with his wife, Lisa, at their kitchen table. “We’ve already hired one or two data scientists. There’s never been a pricing index for last mile, so that’s a data science project we’ve already begun, with the understanding we’d execute it post round. We want to drive fidelity around pricing and expose it to shippers so they can develop more sophisticated cost planning.”

Catania said OneRail’s data modeling and algorithms use AI to determine things as granular as when a courier is delivering better SLAs in the afternoon than the morning in a particular market, then adjusts its recommendations to tweak volume up or down to boost performance. OneRail has access to 600 carriers and couriers and 10 million drivers in its network across parcel, LTL and cold chain, with more being added weekly.

The company’s business model is the antithesis of the gig model, where Catania said the economics don’t work at scale for major shippers. He said it’s driving a flywheel effect: as more shippers come onboard, more shipping data is fed into the system, allowing greater efficiency and accuracy outputs from the AI modeling to improve performance, drawing in more shippers.

OneRail also has an in-house team to manage exceptions, such as late or missed deliveries or wrong addresses, helping it get to an on-time rate of 98%, ahead of the major carriers, Catania said.

In Q1 of 2023, Catania said, OneRail will “containerize” its solution by making it available to SMB merchants as an app in the Shopify store. “A one-store retailer can put in a credit card in, download the app and be shipping within 24 hours,” he said. “That’s exciting for us to be able to onboard them that quickly, and a great channel of growth.”